Thumb of Michigan | Nob Hill Farm - 2/15/2015 10:01
We have had some credit card debt,got them payed off. Are we better off to cancel the cards or keeps them open as for our credit score goes? Sure as check don't want to use the much anymore...
Depends somewhat on your purchasing patterns and where you purchase stuff from- as far as cancelling them anyway.
Some people don't have a need for a high credit score. The rest of us worry about it some. Michigan approved credit scores as being important on what insurance companies could charge. I know, I know- it didn't make sense to me either. BUT- had a family member who had always been a pay as you go person. Could care less about credit scores, didn't need credit. Carried no debt, cash or check for everything else. No claims, no tickets. Insurance went up by 45% in one year. Became very interested in what their credit score was after that.
Not sure if thats still done in Michigan or not anymore- but you never know what may be next.
Also, having a "lot" of credit cards is kind of all relevant. I may have too many, but they all have a purpose. I have one for business expenses. Use that one a lot, like writing one check a month rather than many. Easy to track expenses and theres a bit of product insurance with it. Have one for online purchases only. Low $ limit on it, and I keep it that way. Have one for every day family expenses. Also have one I use specifically for travel- it has some extra travel insurance features i like, especially if I'm traveling outside of the US. Don'y use it much. All of the cards I have are cash back, I haven't had one that I use for travel points of other merchandise in many years. Programs change before I can earn anything real meaningful.
Anyway, I've cancelled unused cards in the past. Maybe the program changes, or they start asking for an annual fee. Or something else weird like that. Canceling a card every year or so if you have others that you do use probably is going to be a simple hiccup in your score. Better in the big picture though. Don't cancel a bunch of them all at once, get on a rotation of some sort if you do have a few extras.
As far as paying off a card goes- I've paid a grand total of under $10 in credit card interest in my entire life. And Ive had a credit card of some sort or another since 1975. Thought I was going to have to pay a late fee I got dinged for once, but card company reversed it. Statement never got to my mail box for some reason. Now have all but one card on auto pay. All credit card companies love it when the card carries a balance. Best way to a better credit score is not carry a balance. Ever. |
credit score and payed off credit cards
